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Last Updated: Thursday, 13 November, 2003, 05:57 GMT
China embarks on US buying spree
Boeing plane
China is opening its market to US planes and cars in a move which could ease growing trade tensions.

Beijing has signed $1.7bn in aircraft and engine deals for 30 Boeing 737s with General Electric engines.

At the same time, pacts with the Big Three US carmakers will allow thousands more US-made vehicles into the fast-growing Chinese auto market.

The US has criticised China for an under-valued currency and a swelling trade surplus.

The Boeing-GE plane deal is designed to supply new aircraft for five Chinese airlines, for delivery in 2005-6.

China's aviation businessis the fastest-growing in the world, with up to 100 airports expected to open in the next decade.

A separate deal to supply engines for a regional jet project could bring GE up to $3bn over the next 20 years.

And aside from the car agreements - which allow extra imports of thousands of cars from GM, Ford and DaimlerChrysler - GM is planning to start car financing operations, in a joint venture with Shanghai Automotive Group Finance Co.

"These latest commercial sales are a sign that China wants to build a stronger trade relationship with the US," said US Commerce Secretary Don Evans.

Tense

The flurry of deals comes as the war of words between Beijing on the one hand and both the White House and Congress on the other continues to swell.

US lawmakers accuse China of effectively destroying American jobs, a message that is likely to loom large in next year's elections.

At about $120bn, the trade deficit with China dwarfs the value of the new deals.

And even the White House has been pointedly unhappy with China, particularly on the subject of its currency.

The yuan, Treasury Secretary John Snow has said, is pegged at far too low a value, making Chinese products unfairly cheap, and should be allowed to float.

The Chinese government for its part says it will consider a float in the future - but will not say when.


SEE ALSO:
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